This research reviews the issues and factors that must be addressed in the selection of a site for a shopping center. The findings of this research are presented in discussions of site analysis, range of goods, population threshold, and agglomeration.
Site selection for either a new business or for a new outlet of an existing business is a critical factor in the development of a strategy that will optimize the probability of long-term success (Murphy & Enis, 1993, pp. 412-415). Market potential, demand, and competitive saturation must be assessed, along with such factors as site availability, adequacy, and costs (Glueck, 1992, pp. 96-97, 101-102). The site location decision must be based on an analysis of the best available data, as opposed to the desires of an entrepreneur or corporate manager.
Location decisions and patterns by firms, households, and individuals are capable of having significant impacts on regional economic growth (Fusfeld & Bates, 1991, pp. 82-102). Studies have demonstrated that a variety of factors, including infrastructure development, are capable of exerting significant impacts on location decisions (Kantor, 1987, pp. 510-511, 515-516).
Location theory, among other things, attempts to explain and predict the locational decisions of firms, and the spatial patterns of industry which are the products of the aggregate locational decisions (Levy, 1990, pp. 4-8). The initial assumption upon which location theory was based was that entrepreneurs attempted to maximize profits in the context of prices fixed by the market, where they possessed perfect information concerning the relative costs associated with all potential locations. Thus, early location theory explained all locational decisions in the context of differences between potential locations with respect to production and transportation costs.
While urban economics is concerned with the location patterns of households, firms, and other...